The four main types of foundation are listed below. A foundation can be multifunctional or it can serve only one specific purpose; it all depends on your reasons for creating it.

Charitable Foundations
These are usually set up in the interests of protecting the environment, building hospitals, opening schools, etc. and offer a way to invest your money while doing something good for society and/or the environment. You could call it a long-term investment in the future of humanity.

Donations
The main purpose of this kind of foundation is to receive donations. Donations may be targeted, meaning that they can only be spent in ways that support the main purpose of the foundation. This purpose can be changed only if the donor agrees. Any conditions allowing the fund to allocate target donations differently should be negotiated before the contract is signed.

Private Foundations
These are usually established by a private individual or wealthy family as a wealth and succession management strategy. Most commonly, they are created in order to plan and control personal savings, funds and properties; to avoid forced heirship; to optimise taxes in terms of real estate property transfer, etc.

Corporate Foundations
These allow companies to structure pension funds, to manage employee benefit schemes and to accumulate and control income from interest, dividends, royalties, etc.

Most popular jurisdictions for foundations
Taking into consideration factors like tax regime, substance requirements and confidentiality, we would strongly recommend the following jurisdictions as the top options for your foundation.

Panamanian Foundation
Panama is undoubtedly one of the most popular jurisdictions for setting up a private foundation, as it is the simplest and the least expensive structure for asset protection that we know of at the moment.

The Netherlands Antilles Private Foundation
The Netherlands Antilles Private Foundation (stichting particulier fonds — 'SPF') is popular with residents of civil-law countries, which generally do not recognise trusts.

The Bahamian Foundation
The Bahamian Foundation is a flexible tool which can be used for different types of foundation and for different purposes, e.g. inheritance planning, charitable or commercial. The Bahamian foundation has distinct legal personality status, which is a great advantage. The Bahamas may also accept a foundation re-domiciled from another jurisdiction.